I have spent 20 years working in nonprofit think tanks, the last 13 as a resident scholar with the Institute for Policy Innovation in Dallas. I also ran the Washington, D.C.-based Council for Affordable Health Insurance for nearly nine years. While I cover a range of political, economic and policy areas, I specialize in health policy. Prior to joining the think tanks, I taught philosophy. I received all three of my degrees—BBA in economics, masters in divinity and Ph.D. in humanities—from Texas universities. I was an ethicist for a medical school's panel reviewing human experimentation. I'm a member of the U.S. Commission on Civil Rights Texas Advisory Committee. For several years I was a political analyst for the USA Radio Network, and I hold a 6th degree black belt in Tae Kwon Do and still teach.

We've Crossed The Tipping Point; Most Americans Now Receive Government Benefits

Obamacare has pushed us over the entitlements tipping point. In 2011 some 49.2 percent of U.S. households received benefits from one or more government programs—about 151 million out of an estimated 306.8 million Americans—according to U.S. Census Bureau data released last October.

Currently, around 6 million to 7 million Americans who have signed up for Obamacare are receiving taxpayer-provided subsidies (though the administration’s numbers cannot be trusted, it’s all we have to work with). There are another 3 million who have signed up for Medicaid.

That means some 10 million Americans—or a total of about 161 million—are now getting government subsidies (though the final number might be somewhat lower since some may have been receiving benefits already).

A Fool and His Money (Photo credit: CarbonNYC)

Thus, perhaps 52 percent of U.S. households—more than half—now receive benefits from the government, thanks to President Obama. And Mr. Entitlement is just getting started. If Obamacare is not repealed millions more will join the swelling rolls of those dependent on government handouts.

Conservatives have long dreaded the day when the U.S. crossed the halfway mark because of all the implications for individual and fiscal responsibility. As Benjamin Franklin reportedly said, “When the people find that they can vote themselves money, that will herald the end of the republic.” They learned that from the 2008 election and turned out in big numbers again in 2012.

It’s not that all of those Americans are “takers,” as former Republican presidential candidate Mitt Romney suggested. Some 42 million are seniors receiving Social Security and Medicare. They aren’t getting something for free; they faithfully paid into the system for decades with the expectation that they would be getting it back at retirement. And they deserve every penny they get—or may not get if Social Security or Medicare has to cut benefits.

But attitudes can change once people are on the receiving end of benefits, even if they are owed those benefits. Seniors who support limited government and fiscal responsibility—in short, the exact opposite of Obama’s policies—become very protective of their benefits. And that makes change difficult.

The bigger issue is the public at large. Conservatives worked so hard to repeal Obamacare over the past few years because once the taxpayer-provided subsidies started to flow, millions would embrace the entitlement and repeal would be very tough. Especially when the media start running stories about people losing their coverage because of heartless Republicans changing the law—although forcing millions to lose their coverage because of Obamacare didn’t stop liberals.

They knew if they were able to ride out the Obamacare rollout storm, the law would likely be here to stay. Franklin D. Roosevelt captured this mentality when he observed: “We put those payroll contributions there so as to give contributors a legal, moral and political right to collect their pensions.… With those taxes in there, no damn politician can ever scrap my social security program.”

And no politicians have; indeed, they have only grown the program over the years.

The country has crossed the entitlement tipping point. The only hope is to try to transition some of these programs, primarily Social Security but also Medicare, into personal retirement accounts. They would, over time, be better funded, actually belong to the worker or retiree, and, perhaps most importantly, they would take millions of Americans off the government benefits roll.

Merrill Matthews is a resident scholar at the Institute for Policy Innovation in Dallas, Texas. Follow at http://twitter.com/MerrillMatthews

Post Your Comment

Post Your Reply

Forbes writers have the ability to call out member comments they find particularly interesting. Called-out comments are highlighted across the Forbes network. You'll be notified if your comment is called out.

One hundred and twenty years ago, Great Britain was THE world power. It spent itself into second rate status. Had the US not bailed it out during WWII, there might not be a Great Britain. If you haven’t been paying attention, there is no one to bail us out.

Your overweening arrogance to the contrary, one day will be the end of the world, for this country. Thanks for helping it along the path to that day.

Great Britain’s empire died largely because of WW2, the US is facing the same fate for the same reason, expensive unnecessary wars.

The world is moving away from using the US dollar for trade, it is no longer relevant in Asia or Europe unless buying goods from the US. Many countries are already buying their energy resources in their own currencies. The IMF has already confirmed that only 33% of the world’s reserves are held in US dollars down from 60% in the year 2000.

I do not think the US will go out with a thud, it is likely to just continue to go out with a whimper.

I have a question about your “entilement cart”. What do you do when all of these people riding in the cart begin to “die off”? Proponents of this “cart mentality” seem to forget about this part of the equation. If you throw them out, doesn’t it weigh less? At some point, the “Baby Boomer” population will start to fall off the backside of the bell-curve.

KilgoreWalley: Here’s a link to the Franklin quote from American History Central. http://www.americanhistorycentral.com/entry.php?rec=469&view=quotes. Several places have it–if you had taken the time to look. But you should notice that I said “reportedly.” The question of whether a mortgage tax break is an entitlement is interesting. People also get a tax break for health insurance. The government considers both of them a “tax expenditure,” but I am not aware of any policy person who considers it an entitlement program. Since I do not believe that the money I earn belongs to the government, then I don’t consider tax provisions that allow me to keep more of my money an entitlement.

If someone cannot push his otherwise compulsory tax burden upon another, then the one who pays taxes subsidizes the one who doesn’t.

You might not like reality, but that is reality nonetheless.

Mortgage deduction means others subsidize the one benefitting from deduction.

You won’t get argument from me though regarding who has property in what.

Politicians have conferred the right upon themselves to share in your profit without investing in you. Net Wages, that is wages less living expenses when above zero is profit. Taxation upon that profit is taking an unearned share.

That Franklin reference is just a one quote in a list of other unsourced quotes. It doesn’t even list where it was written or spoken. Besides, it’s not incumbent upon the reader to do the research for the author.

My point regarding mortgage tax interest wasn’t to say it was specifically an entitlement. I don’t consider it an entitlement. I was just wondering if it was included as a benefit of a government program in the statistic “49.2 percent of U.S. households received benefits from one or more government programs”. The point being that many people might be unwittingly receiving benefits from the vaguely defined government programs, even as they blindly espouse them when they’re labeled “entitlements”.

But then, this opinion piece was never meant to debate the finer points, only to roil the masses.